Europe is leading the charge on climate change, while polluters from China and Trump's framing of climate change as a 'hoax' are holding the world back so the story goes. But could European claims of climate virtuousness ring hollow? Angus McNelly of King's College London argues Europe and North America's efforts to tackle climate change are actually harmful on the ground. By necessitating climate investments are profitable, we're tearing up ecosystems to make carbon offset projects that harm locals and damage ecosystems, and all the while tying up developing economies to this market led approach and forcing their populations to come to us to solve their problems.
In the West, Europe and North America are assumed to leading the battle against climate change, hindered by polluting Chinese industry or Middle Eastern oil producers. While there may be some truth to this, the West’s answer to the climate crisis is underpinned by blind faith in markets and exploitation of the environment elsewhere. By relying upon private finance to solve our crisis, we’re surrendering the planet to market forces. What’s worse, we’re forcing the rest of the world to do likewise. As one Kenyan official famously quipped: “Every time the Chinese visit, we get a hospital. Every time the British come we get a lecture.” Arguably, now more than ever that lecture rings hollow.
We are already in the midst of the climate crisis, although the worst is yet to come. We need to adapt to changes in our climate already underway and to pay for climate disasters such as the California wildfires or the floods in Valencia. We also need to mitigate for future changes to our climate by transforming land use and agricultural systems and transitioning away from fossil fuels towards green energy. These are no small tasks, and they need to be done fast.
Arguably, who pays has become the central concern in the fight against climate change. "Almost everybody agrees that hugely scaled-up and cheap financing are a necessary condition for achieving the needed clean energy revolution in emerging and developing countries", argues the Chief Economist Correspondent at the Financial Times (FT), Martin Wolf. The acrimonious end to the latest round of climate negotiations at COP29 last November, which hinged on the US$300 million finance deal, is symptomatic of this.
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The American Petroleum Institute, was delighted, declaring “This is a new day for American energy.”
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More often than not, the problem of finance is framed as one of resource allocation: how to attract finance. From this perspective, finance appears as a neutral external factor and the problem of finance one of lack or absence. In other words, not enough finance to pay for the construction of new “green” infrastructure and technology is the major barrier to the green transition.
That, and the return of Donald Trump to the White House. On his first day in office, President Trump slashed environmental regulations and rolled back on his predecessor Joe Biden’s green energy programme, the Inflation Reduction Act (IRA), and pulled out of the Paris Accord (again), promising to “drill, baby, drill,” The fossil fuel lobby, the American Petroleum Institute, was delighted, declaring “This is a new day for American energy.”
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“Wall Street will dictate here,” claims a private equity insider, “and you know what? They don’t have a political agenda.
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19th March 2025
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